Canterbury earthquakes (2010-2011)

On September 4, 2010, at 4:35 a.m., a magnitude 7.1 earthquake strikes Darfield, about forty kilometers from Christchurch: heavy damage, no deaths. On February 22, 2011, a magnitude 6.3 aftershock, shallow and almost beneath the city center, kills 185 people and destroys the business district. Further shocks follow, including those of June 13 and December 23, 2011. Insured losses for the whole sequence amount to more than 30 billion New Zealand dollars, one of the highest ever measured against a country's domestic output. The Earthquake Commission (EQC), a public insurer, paid residential losses first, up to 100,000 New Zealand dollars per dwelling at the time, and its cover reinstated with each event. Private insurers took the rest and all commercial business. For reinsurance, the sequence tested everything. The hours clause (generally 72 hours for earthquake) made each large aftershock a separate event, with a new retention and a reinstatement used up. Depending on the renewal date, the sequence ran across two treaty years. And the damage to a building hit three times had to be split between events, often with no survey in between: disputes lasted years, and the EQC had to reopen thousands of files. After 2011, New Zealand capacity became much more expensive, and home insurers replaced uncapped full replacement cover with declared sums insured. Not to be confused with a single large magnitude event such as Tohoku: in Christchurch, repetition made the loss.